The forecaster who ruffles the Swan

Stephen Anthony admits the boutique Canberra-based budget modelling company he founded in 2007, Macroeconomics, has not won many friends in the Gillard government of late.

Dr Anthony, a former Treasury and Finance Department official who specialises in state and federal fiscal policy analysis, has become a critic of Labor’s failure to tackle long-running budget problems.

“We don’t do this because we think it makes us money, because it doesn’t; we do it because we think it’s the right thing to do," he told The Australian Financial Review.

Dr Anthony slammed Treasurer
Wayne Swan
in September for “raising spending promises you can’t keep" after the Financial Review estimated Labor’s long-term policy pledges would cost $120 billion by the end of the decade.

In the tight-knit world of Canberra’s professional policy wonks, taking shots at the government can be potentially career limiting.

The La Trobe educated PhD economist with a masters in public policy and economics from Washington DC’s George Town University is one of just a handful of independent budget scrutineers prepared to stick his neck out. The best known is probably Deloitte Access Economics modeller Chris Richardson. Both produce twice-yearly assessments of the federal budget that are rarely welcomed by governments.

But Dr Anthony, 43, is no outsider to Canberra’s workings. He started his career at the Australian Taxation Office, worked on fiscal policy at Treasury between 2000 and 2003, and analysed spending trends for the Finance department between 2004 and 2006. He completed his doctorate at La Trobe on the importance of the Industry Commission, a precursor of the Productivity Commission.

Macroeconomics employs a staff of about six. It provides analysis for clients such as state government agencies, non-for-profit organisations and private sector industry groups seeking to model policy proposals.

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“We’re very discriminating about who we’ll work for," he says. “If you’ve got a good idea and think it’s in the national interest, we’ll probably work for anyone."

But he says the firm would have “qualms" working for groups representing the gambling, sex or alcohol industries, and avoids working for political parties.

He usually urges political parties to have their budget policies costed by large accounting firms with the necessary manpower, which he estimates at 50 or 60 people.

“The perennial trap for an agency like us is to be seen to be partisan, one way or another," he says.

As an aside, he welcomes the newly created Parliamentary Budget Office, saying he hopes it eventually produces alternative budget assessments so “the role for firms like us will be severely reduced and that’s a good thing, we’ll happily give it up".

However, he does wonder whether it has been given sufficient resources to prevent it becoming a rubber stamp for similar work done within Treasury and the Finance department.